The One Big Beautiful Bill (OB3) Act

Incoming Freshmen & transfer Students

New and Transfer undergraduates fall completely under the new federal guidelines.

 

Federal Direct Loan Borrowing Limits:

	Dependent Students	Independent Students
	(Except students whose parents are unable to obtain PLUS Loans)	(And dependent undergraduate students whose parents are unable to obtain PLUS Loans)
First-Year Undergraduate Annual Loan Limit:	$5,500  No more than $3,500 of this amount may be in subsidized loans.	$9,500 No more than $3,500 of this amount may be in subsidized loans.
Second-Year UndergraduateAnnual Loan Limit:	$6,500 No more than $4,500 of this amount may be in subsidized loans.	$10,500 No more than $4,500 of this amount may be in subsidized loans.
Third Year and Beyond Undergraduate Annual Loan Limit:	$7,500  No more than $5,500 of this amount may be in subsidized loans.	$12,500 No more than $5,500 of this amount may be in subsidized loans.
Aggregate Limit
Subsidized and Unsubsidized Aggregate Loan Limit:	$31,000 No more than $23,000 of this amount may be in subsidized loans.	$57,500 No more than $23,000 of this amount may be in subsidized loans.
Lifetime Limit*:	$257,500	$257,500

*Lifetime limit DOES NOT INCLUDE Parent PLUS Loans.

 

Parent PLUS Loans

Parents utilizing the Parent PLUS loan may borrow up to $20,000 per year, per child, with a lifetime limit of $65,000 per child.

 

RETURNING & CURRENT STUDENTS

If you are currently enrolled (as of Spring/Summer 2026) and have previously borrowed federal direct loans, you may be protected under Legacy Provisions. This allows you or your parents to temporarily keep borrowing under the older, prior federal rules and loan limits.

Important: Legacy status is determined by federal law and applied automatically. It cannot be waived or turned down.

 

HOW TO QUALIFY FOR LEGACY STATUS:

You had a Federal Direct Loan disbursed on or before June 30, 2026.

You stay at the same school in the same program (undergraduates can change majors, but must stay at the undergraduate level).

You maintain continuous enrollment with no withdrawals or breaks.

Semester students: Summer terms are optional. However, if you enroll in summer and then withdraw, it counts as a drop in enrollment, and you will lose legacy status.

You are within the expected timeframe to finish your degree (the shorter of three academic years or your remaining program length).

 

SCHEDULE OF REDUCTIONS FOR PART-TIME ENROLLMENT

Please note that all students (including those with legacy status) are subject to the new Schedule of Reductions (SOR). If you drop below full-time status, your loan amounts will be pro-rated using the credit-hour formula detailed in the section above.

If you do not meet the legacy qualifications, your financial aid will default to the new rules outlined for Incoming Freshmen and Transfer Students.

 

PLUS Loans

Parent borrowers who qualify for the legacy provision are eligible to continue borrowing up to the cost of attendance minus any other financial assistance the child is receiving.

Schedule of REDUCTIONS FOR PART-TIME STUDENTS

Starting in the 2026 - 2027 academic year, if you are enrolled less than full-time, your subsidized and unsubsidized loan amounts will be reduced proportionally using the Schedule of Reductions (SOR) formula:

 

Reduced Annual Loan Limit Percentage 

=( Number of Credit Hours Enrolled for the Term Number of Credit Hours Considered Full Time for that Term for the Program of Study ) x 10

 

• Full-Time Example: A dependent freshman taking 12 credits in both Fall and Spring can borrow the full $2,750 per semester.
• Part-Time Example: A dependent freshman taking 6 credits (50% of full-time) can only borrow 50% of the limit, which is $1,375 per semester.

Pell Grant Eligibility Changes

Students will not qualify for a Pell Grant if:

• Their full Cost of Attendance (COA) is already met by non-federal grants and scholarships.
• Their Student Aid Index (SAI) is more than double the maximum allowable Pell Grant amount.